Doh! IRS Sent $34 Million In Stimulus Checks To Non-Citizens In Foreign Countries

Yet another IRS blunder is costing US citizens more money. This time, they’ve acknowledged that they “accidentally” sent $34 million to more than 28,000 non-citizens in foreign countries. Seems as though the covfefe is because these people claimed some income in the United States, so they ended up in the IRS database. Predictably, the bureaucratic brainiacs didn’t see anything concerning about sending checks to non citizens in other countries.

NPR (if you can believe that) first reported this back in August:

Thousands of foreign workers who entered the U.S. on temporary work visas received $1,200 checks in error during the first round of stimulus payments, and many of them are spending the money in their home nations. One tax preparation firm told NPR that it has clients from 129 countries who mistakenly received stimulus checks, including Brazil, Canada, China, India, Nigeria and South Korea.

Government officials and tax experts say the mistake happened because many foreign workers, whether unintentionally or on purpose, file incorrect tax returns that make them appear to be U.S. residents. Some of them are now trying to amend their returns because they worry that having mistakenly received a stimulus check will jeopardize their visa status, green card application or ability to return to the U.S.

How much stimulus money was mistakenly sent to foreign workers living overseas is difficult to quantify. But Sprintax, which does U.S. tax preparation for nonresidents, did about 400 amended returns last year for people who mistakenly filed as U.S. residents, and so far this year it has done 5,000 — almost 5% of the total federal tax returns it filed last year, according to the company. If just 5% of last year’s more than 700,000 student and seasonal workers with F-1 and J-1 visas received a stimulus check in error, that would total $43 million.

Many of those workers are college students, often from Eastern Europe and South and Central America, who travel to the United States for temporary and seasonal low-wage jobs such as waiters, lifeguards and hotel housekeepers at ski resorts, amusement parks and beach destinations. In a typical year, the U.S. issues work visas to several hundred thousand foreign students.

Now the IRS has confirmed the mistakes, as NPR reports in a new follow-up story:

The IRS now acknowledges that its own error caused some citizens of other countries to mistakenly receive $1,200 coronavirus relief payments — and that the mistake is likely to happen again if more stimulus money goes out.

When reports of the mistake first surfaced, the U.S government placed the blame on those non-Americans, saying that many noncitizens erroneously received stimulus checks because they had filed incorrect tax returns that made them appear to be American.

But many non-Americans who received stimulus money do not file U.S. tax returns. One of them is Susanne Wigforss, a 78-year-old Swedish citizen who lives in Stockholm.

Wigforss was surprised in July to get a $1,200 check in the mail from the U.S. Treasury. It was followed by a letter from the White House signed by President Trump, addressed to “My Fellow American” and informing her that “your economic impact payment has arrived.”

Asked about this by NPR, the IRS acknowledged it mistakenly sent checks to some noncitizens who receive Social Security and other federal benefits — such as Wigforss, who receives a small Social Security payment from having worked in California for several years.

“This is so wrong,” Wigforss said, “because I saw that a number of people were being evicted every month in Chicago, for instance, and I thought one of those families would have needed this stimulus check. Why should a Swedish citizen living abroad receive $1,200?”

“There’s no way I’m going to cash this money — it doesn’t belong to me,” she added. “But how much money is bleeding out from the Treasury Department because of these [misdirected] stimulus checks, I wonder?”

The U.S. government cannot answer that question. The Treasury Inspector General for Tax Administration did find that, as of late May, $34 million in stimulus money had gone to people who filed a tax return with a foreign address.

But that includes eligible people, such as U.S. citizens living abroad, and does not include ineligible foreign citizens who received a check at a U.S. address. For example, NPR interviewed a citizen of the Dominican Republic who was not eligible yet received a $1,200 economic impact payment at his former address in Massachusetts. That $34 million also does not include people, such as Wigforss, who received a check but did not file a U.S. tax return.

U.S. Treasury officials said they are “continuing to assess the accuracy of the economic impact payments … and the recovery efforts for any erroneous payments.” In the meantime, they told NPR, the IRS is “relying on individuals to voluntarily return these payments.”

Recall that earlier in the year the IRS came clean about sending stimulus checks to 1 million deceased people. Perhaps that’s how Sleepy Joe found all his mysterious extra votes?

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